UK significantly worse under all Brexit scenarios – official forecast | Policy

According to a benchmark economic badysis conducted by a range of ministries, including the Treasury, the UK would be worse off in all possible Brexit scenarios in 15 years.

The highly anticipated document concludes that the Checkers plan from 2035 to 2036 would result in a 0.6% GDP decline, even though it was dropped after a conservative right-wing uprising, and 7.7% less if the UK collapses without agreement, compared to the UK remaining in the European Union.

The officials modeled each scenario on a range, comparing them in nominal terms. In the worst case scenario, GDP would be 10.7% lower than if the UK had stayed in the EU in 15 years, baduming there was no more net migration in the United Kingdom from the EU and the European Economic Area. (EEE) after Brexit.

Prior to the publication of the badysis, Chancellor Philip Hammond said the UK would be in a worse situation after Brexit. He said: "If you are considering this from a purely economic point of view, there will be a cost to leave the European Union as there will be obstacles to our trade. "

Remarkably, none of the scenarios modeled exactly at the May agreement was accepted over the weekend, but badysts produced a scenario based on auditors with 50% higher non-tariff barriers to facilitate the process. comparison. According to them, the GDP would be lower by 2.1% in 2035-2036.

The deal negotiated in May will probably end up somewhere between the two scenarios described by the auditors: this would mean that the UK would be in a worse situation between 0.6% and 2.1% than staying in the United States. EU in terms of nominal GDP in 2035-2036.

John McDonnell, the Chancellor of the Shadow, to whom an urgent question was asked in the House of Commons after the publication of the badysis, said that it was ridiculous that officials had produced a Economic badysis plans based on the Checkers proposals, which the government has abandoned.

"The only thing this document shows, the agreement on the table is worse than the agreement on the abandoned Checkers," McDonnell told the MPs.

The Chancellor had previously told the BBC that the May agreement "would absolutely cost-down" as a result of a less stringent trade deal with the EU. "The economy will be slightly smaller in the Prime Minister's favorite version," he said.

The official badysis also concluded that:

• According to the Norwegian EEA scenario, favored by some conservative conservatives, the GDP would be 1.4% lower in 15 years, which is worse than the additional scenario developed after the signing of the May agreement during the first half of the year. weekend.

• Under a Canadian-style deal, backed by Boris Johnson and David Davis, the UK would be in a worse situation at 4.9% than staying in the EU, concludes the United States. ;study.

All scenarios were based on the badumption that the EU's migration rules remained virtually unchanged. If migration rules are tightened to the point where net EU and EEA net migration is zero, GDP would be 1.8% lower in 2035-2036.

According to the official badysis, public sector net borrowing would increase to £ 141 billion within 15 years on the worst case scenario, according to the official badysis, in which there was no net migration from of the EU.

In the central case, the loan would be £ 119 billion higher in a non-transaction scenario. £ 96bn more on a Canadian-style scenario and £ 27bn more on the Checkers scenario. Migration would remain at similar levels if the UK adopts a Norwegian model, but by allowing migration, borrowing would be £ 22 billion higher.

The Brexiters immediately accused the government of launching a "fear of the project" propaganda attack. Davis, the former secretary of Brexit, said: "In the past, Treasury forecasts have almost never been accurate and, more often, they were dramatically wrong."

Predictions that the UK economy would shrink by 2.1% in the 18 months following a clearance vote were unfounded, Davis said. The economy has actually increased by 2.8%.

The professional organizations, however, fought back. Rain Newton-Smith, the CBI's chief economist, who represents employers, said: "These forecasts paint a dark picture on the long run of a Brexit without agreement or a Canadian style deal. This surely sets aside some of the most far – fetched ideas that a hard landing Brexit will not seriously harm the economy. "

A regional breakdown also showed that in a non-agreement scenario, northeastern England would be the most affected, followed by the West Midlands, North West and Northern Ireland. London would be easily the least affected.

In the best of scenarios, London and the Southeast would be the most affected, but the impact on overall GDP would be much lower. Scotland, Wales and Northern Ireland would be the least affected.

The title badysis was based on the badumption that the UK would be successful in signing free trade agreements with the US and a range of other major non-EU economies after Brexit, such as China. , India and Australia.

The comparative figures published in the badysis do not take into account any economic growth; the chosen scenarios have been compared to the current UK membership of the EU.